A Negative Externality Exists When the Actions of One Party

question 224

True/False

A negative externality exists when the actions of one party impose costs on a second party.

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Definitions:

Median-Voter Model

A theory suggesting that the outcome of majority-rule voting systems will reflect the preferences of the median voter.

Preferences

Individual choices or inclinations towards certain products, services, or outcomes over others.

Location Subsidies

Financial incentives provided by governments to encourage businesses to set up or expand in particular areas, often to stimulate economic growth.